Selling a home? Be prepared to wait months, not days, for a buyer

by Paul Owers

01/26/06

Fred Stokes just listed his three-bedroom lakefront home in Boca Raton for $439,900, and interest from buyers has been slow so far. Last year, his daughter sold her home nearby in a week for more than she was asking, but he realizes the real estate market has changed.

"The way I look at it is, I live in paradise," said Stokes, 60, a grandfather of eight who has no immediate plans to cut his asking price. "If I have patience, I'll eventually make money on the house."

Patience is the new buzzword for sellers in South Florida as the once-hot housing market cools off.

The Florida Association of Realtors said Wednesday that median sales prices of existing homes rose across South Florida in December compared with the figures a year ago, but prices have essentially remained flat during the past six months.

"In today's market, [rapid] appreciation can't be counted on like it was a year or two ago," said David Dabby, a Coral Gables-based real estate analyst. "If you're buying a home for that reason, don't buy it."

The December median -- half the homes sold for more, half for less -- rose 22 percent, to $369,000, in Broward. It rose 20 percent to $408,200 in Palm Beach County, and 27 percent to $377,700 in Miami-Dade.

But from July to December, median prices declined in Broward and increased slightly in Palm Beach and Miami-Dade counties.

The number of home sales also has dropped steadily across the region -- by about 40 percent in December, compared with the year-ago period. Agents attribute the decline to rising prices and interest rates and to the lingering effects of Hurricane Wilma, which hit South Florida on Oct. 24.

"There's more looking than there are [contracts]," said Fort Lauderdale agent Marilynn Obrig, a spokeswoman for the Broward Master Brokers Forum. "There's a change in the level of excitement or motivation to buy right now. It's not quite as frenzied."

Nationally, home sales fell 5.7 percent last month, to a 6.6 million annual rate, their lowest level since March 2004, according to the National Association of Realtors. Sales still finished 2005 at an all-time high of 7.072 million.

Florida also enjoyed a record year for closings (248,565) and median price ($235,100).

Overall in 2005, median prices increased 29 percent, to $361,100, in Broward and 30 percent, to $390,100, in Palm Beach County, compared with 2004. Miami-Dade's median rose 28 percent, to $351,200. Existing home sales fell across all three counties in 2005.

The Florida statistics reflect only single-family houses, but the national numbers include townhomes, condominiums and co-ops.

While the South Florida market remains strong, it's clearly in transition, agents say.

It used to be that homes selling for less than $1 million had multiple offers and were scooped up in two to 10 days, said Scott Agran, president of Lang Realty in Boca Raton and Palm Beach Gardens. Now those multiple offers have mostly dried up, and sellers have to wait two months or more before getting sales contracts.

"Buyers are more methodical and not as quick to pull the trigger," Agran said. "After the [tourist] season, I think we could see things lean more to the buyer's side."

Greg Silva, 54, has tried to sell his home in Lighthouse Point, originally listed at $2.6 million, since March but the luxury market has lagged. He finally signed a contract for $200,000 less than he had asked and hopes to close next month.

Silva, the chief executive of a martial arts management firm, wants to see the housing market shift so young people and middle-class consumers can afford to buy. His 27-year-old daughter hopes to live in Delray Beach, where prices of townhomes start in the mid-$300,000 range, he said.

"Where do they come up with the down payment?" Silva said. "It's tough for young people to get started with prices the way they are."

And that's exactly why the market needs to correct itself, said Mike Dooley, a Jupiter Island agent and newly installed president of the Orlando-based Florida Association of Realtors. Despite the slowing trend, Dooley expects the market to remain solid in 2006.

"To go from a red-hot market to a hot market is not a negative comment," he said. "Thirty to 40 percent price appreciations? That's not a healthy market.

"I think this is a period where we're going to have a balancing, if you will. And that's good."

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